Data Sheet—Extra Scrutiny for Facebook and Google, Square’s Big Jump
Last week the biggest U.S. Internet companies flexed their earnings muscles and added billions in market value. This week expect these leaders to experience what all who achieve great success always do: extra scrutiny.
As The Economist observes in this comprehensive roundup, the era of gooey-eyed support for the wonders of the Internet age are over. Amazon’s destruction of everyone else’s business isn’t cute anymore. Facebook and Twitter made for a friendly platform for Russian propagandists. And Google has hollowed out the traditional media industry, threatening democracy in the process.
The spotlight grows harsher. This morning a human rights group associated with the World Economic Forum releases a long white paper arguing that as “an alternative to government regulation … companies like Google, Facebook, Twitter, and Microsoft should assume a more active self-governance role. Corporate leaders need to take greater responsibility to vindicate such core societal interests as combating harmful online content and elevating journalistic reporting and civil discourse.” Already, a Republican lobbyist has circulated a presentation comparing today’s Internet moguls with the robber barons of yesteryear. On Thursday, the general counsels of Google, Facebook, and Twitter will testify before the House Intelligence Committee’s “Russia Investigative Task Force.”
Get Data Sheet, Fortune’s technology newsletter.
It doesn’t sound like a lot of fun for them.
The New York Times had a good piece last week on Square, the payments company started by Twitter co-founder Jack Dorsey, which we highlighted in the newsletter on Thursday. I similarly observed nearly two months ago, in a piece called “How Everyone Missed Square’s Comeback,” that low-profile Square had more than outshone troubled Twitter. The Times piece, while solid, had some unfortunate timing, given that it predicted Square could shortly surpass Twitter in market value. It appeared just before Twitter turned in a quarter that pleased investors, sending its value to nearly $16 billion versus Square’s $13 billion.
If, like me, you’re trying hard to understand China’s Internet giants, I highly recommend a month-plus-old piece in The Economist that discusses the arcane maneuver many of them pulled to go public outside China while maintaining controls for their Chinese founders. The dense but important piece calls this structure, known as variable interest entities, or VIEs, “a polite legal fiction that papers over serious problems.” It’s one of those techniques that works great—until it doesn’t—and therefore merits close attention.
Threats and what not. The daughter of an Apple engineer posted a YouTube video about her dad's unreleased iPhone X and got him fired. (Though the anecdotes are not quite 100% confirmed.) And Roger Stone, a close ally of the president, says he plans to sue Twitter for suspending his account over abusive tweets he posted.
Squeezed. Juicero couldn't make it and neither could the Juicero of tea: Teforia. The company, which planned to sell a $1,000 tea maker, said it was shutting down due to a funding shortfall.
Now who’s getting squeezed? A $1,000 tea maker seems ridiculous on its face. A $1,000 iPhone? Very popular. Apple said demand for pre-orders of its top model "is off the charts." By Monday, new orders were delayed up to 6 weeks. But keep a firm grasp of the new glass-backed gadget. Apple said repairs of the iPhone X will be much costlier than earlier models, including $279 to repair a cracked screen (without AppleCare coverage).
Lucky duck. Author and journalist Steven Levy has been writing about Apple for a long, long time, so the company not only decided to give him an early, review unit of the iPhone X, it also let him publish his review before anyone else. Levy loves the new OLED screen and the Face ID unlock feature, though he finds the wireless charging “mostly useless now.”
Heavy hitter. Former federal prosecutor and Associate Attorney General Tony West, who helped bring down Bank of America's mortgage unit and support same sex marriage, joins Uber as chief legal officer after a stint as general counsel at PepsiCo. Former Uber top lawyer Sally Yoo said last month she was leaving the company.
Butterfingers. On a West London street, someone dropped a USB memory stick filled with confidential maps and documents, including the exact route and security measures used by the Queen on her way to Heathrow Airport.
How we live now. Google CEO Sundar Pichai either doesn’t have enough work to keep him busy or is a serious emoji user. After a few folks complained about Google’s rendering of the cheeseburger icon (cheese underneath the beef?), Pichai took to Twitter to promise he’d fix it ASAP: “Will drop everything else we are doing and address on Monday:) if folks can agree on the correct way to do this!”
Undo. Microsoft’s $20 billion cloud revenue run rate last quarter referred to its entire cloud software spread, not just the Azure unit, as I mistakenly wrote on Friday. Word in the cloud, you go kid!
FOOD FOR THOUGHT
Augmented reality is the technology that projects digital artifacts onto the real world, though the manifestations can only be seen when viewed through a phone's camera screen, special glasses, or some other gadget. Futurist Matt Ranen is worrying about the rights of property owners to limit or block such digital graffiti from "appearing" on their locations. I'm not sure it's really that much different than a negative Yelp review or harsh comment on Amazon, but wait until neo-Nazis have their own version of AR labels everywhere. As Ranen explains:
This line will be drawn, in part, from a pure ethical standpoint: for instance, one might argue that a work shared with just a handful of friends is harmless, but one that is generally available and prompted for when people walk by is more of a public statement. But it will also be dictated by more practical considerations, such as how someone (the owner, law enforcement, etc.) would even know that there was a tag at all. And of course, it will likely matter as to what type of statement is being made and the degree to which the owner might be impacted by it. The latter takes us into the quagmire of rights to speech and libel law, beyond the pure “who owns the virtual space” question. The debate around this might even lead to arguments that all virtual space is essentially public and can not be controlled by private owners.
IN CASE YOU MISSED IT
GameStop Has a New Way to Get You to Pay for Used Games By David Meyer
Tezos Rebuffs Rumors of SEC Probe Into $232 Million Crypto ICO By Jeff John Roberts
Steve Jobs' BMW Z8 Is Going Up for Auction By Natasha Bach
Here's Why Amazon, Microsoft, and Intel's Shares Are Soaring By Jonathan Vanian
Now WhatsApp Allows You to Delete Messages By Emily Price
BEFORE YOU GO
Journalists have various headline writing tricks. When reporting somethimg that hasn't been reported previously, but that did not occur recently, one favorite is to say a company made a move "quietly." Tim Ellis at Geekwire did a neat data analysis of all the "quietly" headlines in tech. Who got the most? Why that silence loving company that makes the iPhone.